>> this week on the journal, editorial report, president obama's fuzzy math. he says closing the loophole isn't enough and that the tax rates must go up for top earners. does he really want to avoid the coming tax cliff? plus, the petraeus scandal further muddies the benghazi probe. was the account of this in any way related to his affair. and the u.s. on track to be be the largest oil producer, but will the obama administration let it happen or turn an oil boom into a bust? welcome to the journal editorial report, i'm paul

gigot. headed into friday, fiscal cliff talks with congressional leaders, president obama gave us a hit list of his negotiations strategies, repeating his intention to immediately raise tax rates on top earners. >> when it comes to the top 2%, what i'm not going to do is to extend further a tax cut for folks who don't need it which would cost close to a trillion dollars and it's very difficult to see how you make up that trillion dollars if we're serious about deficit reduction, just by closing loopholes and deductions. the math tends not to work. >> paul: but does the president's math add up? let's ask wall street journal columnist bill mcguerin, and analyst steve moore and washington columnist kim strassel. so, kim, the president won reelection, was this the hand of magnimty reaching out to

the republicans? >> it's crazy, it's what the president says all the time. if you listen to the press conference, he seems to say the biggest wish list for his liberal partisans has become docile letting these tax rates expire. while the republicans have moved, they are offering revenue, this is a change from their position, while the frame work is potentially there for a deal, the president is saying no compromise, no compromise. >> paul: what's his strategy, bill, here? what is he thinking? obviously, if we don't get a deal we do go off the tax cliff and the with the consequential danger to the economy. >> kim is right, you're right, the math doesn't add up, the politics adds up. $. >> how so? >> i'm afraid what's going to happen we're not only going to get bad policy, a tax increase and so forth. but we're going to-- the republican party as opposed to bad policy are also going to get the blame for the consequences and this is why. because if the economy goes

into the tank because we get the stuff, and the republicans will, because we don't get it, whatever way, the republicans are going to be blamed for being obstinate if they oppose some of the tax increases or if they go along, their own base is going to revolt over the tax increases. so, it's a no-win situation and the reason is, as kim sort of alluded to, this is a president who uses the word compromise as a substitute for actually compromising. and that's, that's solidified by a press corps that doesn't ask him a single question, what are you willing to give. you know, when john boehner appears, they say are you willing to accept higher rates. no one says what are you going to do about entitlements or anything, there's no question of the president whether he will compromise and what that would look like. >> paul: steve, what do you think the republicans ought to do here? is there a way out for them or are they going to be pushed back into a corner where they have no choice, but to concede

that they have to raise tax rates or else go over the cliff and get blamed for that? >> well, it's a tough situation for them. there's no question about it because as you know, the default position, if we don't do anything is for the taxes to go up on everybody on january 1st, and that's something i think both sides want to avoid. it's very interesting, the thing that happened this week to start the week, was who was the first person that barack obama met with in the white house since his election, the labor unions, the labor block, that tells a lot who is driving policy at least at the start of the second term? and the labor unions basically said we want no compromise on this, we'll take it to the people. so, i believe, paul, that this president is sporting for a fight on this. he wants to take this case to the people and the republicans, kim is right, the republicans have moved a long way and say, look, we'll negotiate this, but when i talked to minority leader this

past weekend in the senate, mitch mcconnell, he says we'll give anything, but one thing we're not going to do is raise these tax rates because they generally believe, and i think they're right about this, raising those tax rates could cause a double dip recession. >> paul: what's the alternative. if the president insists on raising tax rates and the republicans say no. all the president has to do is let the taxes go up on january 1st, he gets the tax increase anyway and beat the heck out of the republicans, for blaming whatever economic consequences happen and then in two months, they're coming back to him and saying, okay, we give in. but he's already got the tax rate. so my question to you, steve, is what's the way out here? is there a way out that if you see it for the republicans? >> well, the republicans and we showed in our editorial this week, the numbers do add up. the republicans should basically say, look, we will close the loopholes. if do you that the people that get hit the hardest are the rich. but i think the most important outcome is to make sure that

barack obama does own this economy. i mean, you've seen what happened to the stock market in the last week, since obama was reelected and he's been talking about raising the rates and we've lost over 650 points on the dow jones, so, i'm not so sure that the investment community or even the public really wants those rates to rise as much as barack obama does. >> and just on the math. if you close, if you put a cap on deductions of 50,000 a year per individual. over ten years the estimate is you get almost 800 billion in tax revenue, which is-- >> right, which is center left operation, but, that's, and that's roughly the same as you get from raising the tax rates the president-- >> looks you've outlined on the editorial base several possible compromises, the truth is that there are compromises that could be made, but i don't think that the president is interested in those, the actual economic things. this is a political fight that he wants, that he's pushing and he has a lot of cards. >> kim, so you think we're going over the cliff or not right now? what are the odds. >> look, i think the president is playing a slightly

dangerous game in that, if his argument or his bet here is that the republicans are going to be more responsible than him, he better hope they are, because otherwise, he could end up getting some blame for pushing us over the cliff. >> yeah, that's right. when the things tend to go bad, both sides get the blame and i think it's a high risk game particularly with economic growth. when we come back, a week after his resignation, former cia director david petraeus has to hiestify behind closed doors about benghazi.

>> a week after resigning his post, former cia director david petraeus testified behind closed doors friday on the september 11th attacks on the u.s. consulate in benghazi libya that killed ambassador chris stevens and three other americans. and his testimony for the house and senate intelligence

committees bizarre revelations about the four-star general's affair with paula broadwell. we're back with phil and kim strassel and joining matt, what have we learned now? the election's over this week, about the benghazi attack. >> the drip, drip of information keeps coming out and coming out. and we've learned far more about the personal life than benghazi the last two months and the important thing this week, especially on friday was that general petraeus was reported to have told the senate intelligence committee in closed hearings that he thought it was terrorism within 24 hours. which questioned the narrative put out by the white house, subsequently and for the eight days afterwards, they said, no, no, al-qaeda had nothing to do with it. this was the fault of the, you know, anti-islam video on youtube. >> paul: video. >> yeah.

>> paul: bill, does that mesh with what we've been told the cia had been telling susan rice? >> i think the real problem for general petraeus in this story is that it not only does not mesh with what the white house was saying, it doesn't mesh with what we're told general petraeus said in the immediate aftermath, where he is said to have talked about a spontaneous flash mob. >> to members of congress. >> to members of congress behind closed doors as well and this is the problem. it's not only that we know that that's not true now, it's that at the time there were a lot of other indications that indicate that was not true, denied by the libyan prime minister, the cia station chief called it an act of terror. we had the fbi and i believe the national center for counterterrorism also giving briefings. >> paul: that's right. >> saying this. why was general petraeus's testimony then so at odds with other parts of the community? >> but does this, would this give-- what does it mean for, say, susan rice and the

administration then? is this, does this help them politically by shielding them or does petraeus here saying i thought it was a terrorist attack, does that mean this puts, for example, susan rice's statements more up to scrutiny? >> well, i think answers the fundamental question, did they deliberately mislead on this case for political reasons because they were driving the narrative that al-qaeda had been decimated and the war, war was receding or a question of incompetence. neither of those two things is good for the administration although it's after the election, so, they can get the consequences. >> let's take a look at the president talking about susan rice, the u.n. ambassador who many think he will nominate to succeed hillary clinton as secretary of state. >> for them to go after the u.n. ambassador, who had nothing to do with benghazi, and was simply making a presentation based on intelligence that she had

received and to besmirch her reputation is outrageous. >> paul: kim, that sure sounds like a president who is ready to nominate susan rice for the state department and my sources suggest that that's exactly what he's going to do. of course, my source haves been wrong before, but if-- and i've been wrong before. but if he does that, is this going to be a really big fight? >> oh, it's going be to be a huge fight because you have had republicans come out already and say, you drop her in the senate nomination battle and then we are going to go to the wall on this one, but i do believe you're right, not only is the president taking an unusual step of devoting during the press conference, but all types of forums to defend susan rice and make the case for her, in this case, you're probably

right, paul. >> paul: so, what do you think, matt, as we go forward. are we missing something here in terms of the larger focus on petraeus and his personal problems? what, is there a larger failing here about the administration in benghazi that may, for example, implicate secretary of state clinton, who has gotten off-- she says, from peru she wanted to take responsibility. but what does that mean? she's not testified at all, not really followed up at all. >> well, i think you have-- it really means there's been a -- they would love to blame it on petraeus,'s now been disgraced and out of the office and blame it on the cia. the problem was this goes back to the white house and certainly to hillary clinton, we have a failing. the failing was on the day of the attacks and a broader failure of our policy in libya. we were dragged into this, intervening last year, we very much disengaged early on. we didn't support the pro western secular government in libya trying to the militias

and suffered a terrible defeat in benghazi and forced to pull out the cia mission there and pull out-- >> not helping the opposition we've creeded the ground to the qataris who armed them who they favor and an islamist ins libya. >> and one point that relates to susan rice and the larger point. the president said why are you blaming susan rice who knows nothing about benghazi. why was susan rice chosen it go out there if she knows about it. why was not mrs. clinton tn or the deputies, either mo people who knew things didn't want to be on the record or read what she was given. >> she knew she was a loyal political operative and do exactly what-- >> where all of this leads to, whether it's general petraeus or hillary, there are questions whether people were being truthful or compromised in some ways and that's not good for us. >> paul: let's hope people

keep digging. when we come back, could it be good news, the report that u.s. is on track to surpass saudi arabia as the world's largest oil producer, but will the obama administration regulate this boom until it goes bust?

♪ >> we thought we'd bring you some good news this week. the international energy agency reported monday that the the u.s. is likely to surpass saudi arabia as the world's largest oil producer as early as 20/20 and predicts that the u.s. will increase production to 11.1 million barrels a day by 2020, up to about 6.9 million barrels in 2008. that is if the obama administration allows it.

so, steve, you've been out to the shale in north dakota where it's coming from, and fracking so-called, and drilling and private risk taking. what does it mean for the u.s. energy markets? >> well, this is such a great, great pro american stir and by the way, paul, it's not just oil, it's also natural gas. >> paul: right, sure. >> my goodness we have more natural gas than the rest of the world combined and it's driven by the technological improvements and a five or ten year technological lead than the countries we're competing with. it's interesting, paul, if you look the at the last three or four years, now what industry has created more than any other industry in the united states. >> paul: the electric car industry, steve? (laughter) >> no, not that one. oil and gas and the thing that's so amazing, the president is doing almost everything he can to try to hold this back with

regulations and with not allowi allowing permitting most of the oil and gas development is going out on private land and where the president has to get with the program because we could literally create millions more jobs if we get this story right. >> paul: jim, the consequences here economically are big for downstream production, things like manufacturing. >> right. >> that had left the, i talked to one ceo, dow chemical, who had planned years ago never to build another plant in the united states and now making a 4 billion dollar bet on manufacturing and chemical production in the the united states. that's extraordinary. you're seeing that all over places like pennsylvania, and ohio. so, this could really be good. what's the risk politically in the coming years? >> to whom? >> to this, to this oil boom, natural gas boom? >> well, the risk of-- from the obama administration is enormous. i think one thing that's interesting about this eia report is based on current

assumption, it doesn't take into account what we could be getting if we were actually actively going after natural resources which, by the way, prior generations of americans set aside, exactly for us to use in places like in alaska, on shore the gulf, off shore off the coast, but the president has resolutely refused to tap any of those, what you see, is an administration thinking hard to think after way to wiggle into the fracking regulatory arena which up till now has been monitored and overseen entirely by the states with great success and that's got a lot of president's environmental allies unhappy and they feel they don't have control and so they're pushing the administration to insert itself into the area. >> the irony, is that natural gas production, bill, reduces greenhouse gas emissions and replaces coal, which is carbon intensive. this could be a win-win for environmentalists and for people who want cheaper energy.

>> although if you look at the environmental websites. >> they hate it, especially the-- >> the issue here, are we going to be texas or california? and satisfy for for four years, the president followed colorado's model. california has a lot of reserves and they've created what, 20,000 oil jobs in the the last ten years, where texas created 200,000 and these are fairly well paying jobs so that's the issue before the obama administration, the second point is the market works. the reason that we can now extract shale, not just technology, but with oil prices higher, it becomes economically possible to to these things that we wouldn't price-wise be possible beforehand. >> well, we've been handed this incredible gift by mother nature. let's hope we don't blow it on the politics. >> we will-- >> we have to take one more break. when we come back, our hits and misses of the week. if we want to improve our schools...

... what should we invest in? maybe new buildings? what about updated equipment? they can help, but recent research shows... ... nothing transforms schools like investing in advanced teacher education. let's build a strong foundation. let's invest in our teachers so they can inspire our students. let's solve this.

♪ >> time now for hits and

misses of the week. kim, first to you. >> a miss to the federal emergency management agency which announced this week that surprise, it will probably have to ask congress for a bailout for its flood insurance program after hurricane sandy. the national flood insurance program has been broken since inception because it fails to require home owners in low lying areas premiums adequate to cover the cost and as a result encourages more home building in areas like this. federal taxpayers everywhere else have to foot the bill and they're 18 billion in the hole and 12 million thanks to health care sandy and this is one of those other disasters everyone saw coming and congress has nonetheless failed to credibly address. >> matt. >> a hit to the french this week, for recognizing that syrian opposition, fighting a long, drawnout war against president assad has been joined by the turks and the gulf states as well which may open up a way to try and arm

them and give more support and hopefully the u.s. will soon follow. >> paul: steve? >> the people in miami are hopping mad this week. we just spent 500 million dollars on a new baseball stadium for the miami marlins. they feel double crossed. this week the owner of the team sold off three of their best players in a big cost cutting move. what's ironic about the story, is that the miami dolphins want the taxpayers to pay for renovations for their football stadium down the street in tampa, they want a new baseball stadium all paid for by taxpayers, if you were a floridian would i would say to taxpayers financed stadiums, no mas. >> paul: they briefly, is the u.s. going to intervene in syria? >> no sign of it yet, but before the election didn't want to touch it, but-- >> that's it for this edition of the journal editorial report. thanks to my panel and all of

you for watching. i'm paul gigot, see you right here next week. ♪ >> on fox news watch, i hear you have some questions for me. >> president obama on his first post election news conference taking on tough issues and tough questions from the white house press. >> congratulations, by the way, i've never seen you lose. >> well, maybe not such tough questions, but i did get testy when asked about the white house spin and the benghazi terror attack. >> if senator mccain and senator graham and others want to go after somebody, they should go after me. >> the president of the united states did not tell the american people the truth about the attacks that took four grave americans' lives that went on for eight, seven hours for which we were totally unprepared. >> how did the media handle this showdown? a new scandal involving now

former cia director general petraeus and an extramarital affair, a florida socialite, a bare chested fbi agent and is this a concern or a washington smoke screen? >> i don't think anyone on either side of the aisle underestimates the difficulties. >> both sides work to gain the high ground in dealing with the looming fiscal cliff, but the media seem to be one-sided in the details. which side do you think they're on? and it's in with the new, but are the old staying, too. >> oh, you've always asked that question except to mitch mcconnell. >> on the panel this week, writer and fox news contributor judy miller. jove oldman, talk radio and jim pinkerton contributing editor the american conservative magazine, and alan colmes, author of thank

liberals for saving america and i'm jon scott, fox news watch is on right now. >> this is about the role she played around four dead americans when it seems to be that the story coming out of the administration and she's the point person, is so disconnected to reality, i don't trust her. and the reason i don't trust her is because i think she knew better and if she did know better she shouldn't be the voice of america. somebody has got to start paying a price around this place, but i am dead set on making sure we don't promote anybody that was an essential player in the benghazi debacle. >> as i've said before, she made an appearance at the request of the white house, in which she gave her best understanding of the intelligence that had been

provided to her. if senator mccain and senator graham and others want to go after somebody, they should go after me. and i'm happy to have that discussion with them, but for them to go after the u.n. ambassador, who had nothing to do with benghazi and was simply making a presentation based on intelligence that she had received and besmirch her reputation is outrageous. >> that began with south carolina senator lindsey graham giving his view of ambassador susan rice and her role in the administration spin on the benghazi terror attacks and the president's reactions to those statements at his first news conference since being reelected. mr. obama, defending ms. rice, but his defense has actually added more to the controversy.

senator graham reacted to the president by saying, mr. president, don't think for one minute i don't hold you responsible for benghazi, i think you failed as commander-in-chief before, during and after the attack. so much to get to first on this, jim, the showdown between the two senators, graham and mccain and the president. abc's terry moran called it an obama smackdown. "the washington post" john mccain's benghazi, and some say it's about mccain being bitter about losing to obama four years ago. >> i think five names and a conflagration, and number one petraeus and broadwell and number two, benghazi, benghazi, petraeus, broadwell, military ethics, mccain obama reduction, and fifth, the susan rice story, which life imitates art. if you go back and watch the movie advise and content shall

the novel then turned movie, it was a south carolina senator opposing the president's nomination as secretary of state that is the whole dynamic of the mie and i'm it willing you, find it on youtube or net flicks because it really parallels, echo out. >> and if it's a media we'll turn it into a media review. the media had an opportunity to ask hard questions and didn't get any at the news conference, why not. >> the format is not controlled to follow-up. he picks the people he's going to call on. people can't respond and say, wait a minute, mr. president, we want a follow-up on this. this is his chosen forum. i'm surprised he hasn't used it more, because we do know that until the election, he was actually hiding from the media on this issue. >> alan, maybe you can explain

the president's-- >> i'm here to speak for the president. >> and his defense ambassador rice added fuel to the fire. you heard him say that the white house sent her out on to the sunday morning talk shows and then he says don't go after her because she didn't have anything to do with benghazi, so why is she on the sunday morning talk shows. >> she represents the administration, and the administration decided to put her out on the sunday morning talk shows, what was her involvement with benghazi, was she part of a coverup. >> of course not. there were strains of intelligence coming in. and david ignatius washington post, reporting early on there was a report video. the president himself used aed word terror in the rose garden and the day after. it seems like the right wing media is trying to make something here, tried to do it during the the election as if it would somehow change the results of election and which it didn't.

and continuing the rap on the president that i don't think was a coverup. >> and then the media seemed to love the defense of ambassador rice, the president. one said, there is no damsel in distress and obama's eternalistic bravado of a top administrative official is going to come back to haunt him. she's a big girl in a big position and she should defend herself and what she said. >> i don't think it's necessarily a right wing smackdown of susan rice, it's the liberal media make it go about john mccain's comments about susan rice and john mccain never used the word filibuster. he said he would have serious issues susan rice as secretary of state. i agree with judy, what is susan rice doing representing the administration on these talk shows? she had nothing to to do with this, why is she the point person. >> it's not her fault. maybe have an administration with putting her out there,

but not to say she shouldn't be secretary of state because she's somehow wrong here, but we have a fair amount of excavating to do, and on friday, peter king, i think an exclusive for fox and megyn kelly saying listen we now know that the cia, peter king knows that the cia initial chronology, benghazi's acts was altered somewhere along the way, did susan rice alter it herself, does she know who altered it. and the hearings under oath are going to be epic, somehow the petraeus version, which petraeus is willing to explain now that he's liberated from the obama administration, rice her fate is going to answer for a whole bunch of coverups. if she's such a shrinking violet and needs the president to defend herself and doesn't

know about benghazi or libya, why would she be nominated secretary of state. would you nominate such a light weight. >> and she's not out on this particular issue, it's not a sexist issue-- >> he didn't do that for eric holder on fast and furious, did he, alan? >> we're going to answer or try to, so many other questions about this story, including the angle jim just brought up, whatever happened to david petraeus

. >> after a long eight months period of what you might call silence and after the reelection, the president holds his 16th full-blown news conference of his president sich sy. if you do the math the president plays golf six times more often than he gives news conferences and the news conferences don't last as long, don't take as long as a round of golf.

why is he so reticent to get up to the press corps and does the press corps use the time-wisely. >> as we've seen in this week's debacle. the press corps does not use the time. and this is what he can control. this is the pattern for the president, goes for the soft media and soft questions and his popularity rises as the number of questions about his policy continue to increase. >> jake tapper at abc asked him some tough questions. our ed henry asked him some tough questions. and then there was this from christy parsons of the chicago tribune. >> thank you, mr. president. and congratulations, by the way. one quick follow-up. >> when i was running for state senate, there. >> that's right i was. >> christy and i go back a ways. >> i've never seen you lose, i wasn't working that one time. >> there you go. (laughter) >> all right, alan, appropriate? >> beautiful, beautiful moment. what do you have against love?

come on. you of course chose a particular heart warming moment there. this is a president, that sat down with bill o'reilly a couple of times, i don't think he's afraid of the press and to conflate the number of times that he, or some kind of counter punctual things with the number of times he played golf versus the number of times he had a news conference, we can play that game with any president, he's not supposed to have recreation, a pardon me, way to look at that. if playing golf is a horrible thing. >> jon: we report, you decide. >> and the whole thing of this idea that it's a real news conference there, were eight questions, one question no follow-ups, and the reporter at the end i believe from bloomberg tried to ask the president a question and the question listened to the same thing and i'm sorry, i can't answer that, because it would set a precedents. >> it's a good question. >> it's a great question, i can't answer it it. that's unbelievable to me and he gets away with it. >> and 16 news conference ises

more than bush had. he's had plenty of news conferences, certainly more media available than our last couple of presidents. >> and then we get to the mess involving former general, well, former general and former cia director david petraeus. it was announced, first of all, after the election that he is resigning as head of the cia, because of an extramarital affair. did the press push hard enough on that? and you know, any indications that it helped to snuff out the benghazi-- >> well, headline in washington post, defen defends... i think it's been pretty well documented that the fbi and the justice department and everybody else at that level knew all about this and now, we just have to believe attorney general holder and everybody else that nobody at the white house knew until, you know, two days after the election and that the record national television didn't know until election day. these are stories even a fawning press, by the way, alan, president obama was last on bill o'reilly in 2008, it's

been a while. >> i think he did it once since then during a half time show. >> hard hitting half time. >> everybody watching by the way in the super bowl, but also eric cantor's office-- >> it's an unbelievable beltway juicy story ever, frankly i mentioned earlier and i think you're going to see a change, the first week or so, petraeus had a sympathetic press and all of these reporters been embedded with him, pun intended in iraq and afghanistan, were kind of fans including on the left. once it became clear though late last week that he was going to say that the cia actually did a good job and different talking points you're going to see the press on him turn big time as they say he's the enemy, he's no longer part of obama administration lying about how we didn't know and it's ambiguous. >> jon: bucking the administration line on this is trouble for him, do you think? >> well, i think that the

mean, the line on general petraeus or director petraeus changed dramatically this week. we did see kind of shock and not awe. shock and horror at the initial reports of why he was stepping down. but now, you're getting an examination by many in the media of the relationship between the media and general petraeus and his great ability to manipulate and curry favor with the media. michael hastings had an extremely interesting piece in buzz feed that pointed out that some of the people who wrote books about him. linda robinson actually went off to work for him in cent-com after they wrote their work, he's very good at that and i think that have to be acknowledged and beginning to be acknowledged in the media. >> jon: we have to talk about this next on news watch. are the media pushing for a plunge off the fiscal cliff? >> the senate has already passed a law like this, the democrats in the house are ready to pass a law like this,

and i hope republicans in the house come on board, too. >> president obama putting pressure on republicans to do it his way or face the plunge offer the fiscal cliff and the media take the cue in the blame game, too, pointing fingers at the g.o.p. for standing their ground. will the pressure of bad press force their hands? answers next on news watch. well, if it isn't mr. margin. mr. margin? don't be modest, bob. you found a better way to pack a bowling ball. that was ups. and who called ups?

you did, bob. i just asked a question. it takes a long time to pack a bowling ball. the last guy pitched more ball packers. but you... you consulted ups. you fod a better way. that's logistics. that's margin. find out what else ups knows. i'll do that. you're on a roll. that's funny. i wasn't being funny, bob. i know.

>> i don't think anyone on either side of the aisle und underestimates the difficulty facing us, but i think the spirit of cooperation you've seen over the last week from myself and my team, from democrats across the aisle, from the president have created an atmosphere where i

think that i remain optimistic. >> we face a very clear deadline that requires us to make some big decisions on jobs, taxes and deficits by the end of the year. both parties voted to set this deadline and i believe that both parties can work together to make these decisions in a balanced and responsible way. >> president obama and house leader john boehner before him sounding somewhat positive on working out a plan to divert the fiscal cliff. they met in person at the white house on friday, along with house minority leader nancy pelosi and senate majority leader harry reid and minority leader senator mitch mcconnell. jeff, it seems like the media are poised to blame republicans if the deal falls apart. >> if you look at the polling, over half the country believes it's the g.o.p.'s fault if this deal falls apart. why that? the democrats and the president himself have done an effective job of essentially trashing republicans saying that this whole, the reason

that there's a, you know, there isn't a deal in the first place, because it's their fault and that's not true. it's both parties that did this and the president particularly not showing leadership and kicking the can down the road and creating a super committee. the media is not covering this correctly at all. reporting that the president want a deficit package. 1 trillion from tending the war and that's going to happen and another trillion from spending cuts in the past so they are he completely ignoring that and again, it's not spending cuts that the president is going to agree to in the end. it's reducing the growth rate in spending and complete the owners suggest he's going all in on the spending cuts. >> and reports that the networks blame the fiscal cliffs on the congress and the g.o.p. 16 times more than president obama. >> and always talking about, having the conservatives are being blamed. the fact is here is a president reelected you can use the word mandate or not, but see that the republican congress which is viewed as a do-nothing congress and the media is accurate when it says it's up to the republicans now to come forward because they've rejected what he

offered the last time. >> jon: all right. jim. >> i must say to me the most interesting story of this is the submarine story of the left, paul krugman, carol, others, saying it's a horrible mistake to do this, it's 1937 all over again in terms of tax increases, spending cuts in the middle of a tentative recovery. i'm not as convinced that the left of the democratic party or left of the country is going to hold still for the deal. it's sort of a centrist beltway thing that the left opposes and right opposes and it's president obama, "the washington post" editorial board, new york times, a few others kind of in the middle there. we'll see. >> jon: the media loved it this week when the president met with some the heads of major corporations, but there weren't really any small business people represented and the question, is it just a photo op? >> well, i think the president is reaching out, he's making an effort to meet with a lot of different people. it is interesting that the first people who saw him after his election were union people

and that shouldn't be surprising, but the media did take note of that. but i think that, mr. boehner's conciliatory attitude reflects exactly as said, the politics of the situation, and david brooks had an interesting column saying not only irresponsible to take the country over the fiscal cliff, but it's bad politics for the republicans. i think that accounts for the mood of con vifalty and consensus. >> and the media says is bad politics-- >> speaking of that the new yorker had a blaring headline this week, is obama willing to leap off the fiscal cliff? let's hope so. take that for what it's worth. next on news watch,

>> i said yesterday we did not have the majority but we have the gavel. excuse me. we don't have the gavel. [ laughter ] >> we don't have the gavel. we have our own gavel. we have something more important. >> nancy pelosi seen earlier this week: surrounded by other women in congress making it known she will run to stay on as democratic leader in the house. so was it a senior moment or wishful thinking? >> i'll go with wishful anying. it's good news for those in the media who like to have nancy